He pointed out that the economic situation all around the world is facing challenges – in the EU, US and Asia-Pacific region.

Putin said that since Russia is tightly integrated in the global economy, it is exposed to those problems and these “worrying symptoms” make Russia vulnerable.

“We must be prepared for the effects that a drop in production and crisis signs in the global financial system could have on our economy. Some of these effects are already making themselves felt, as we can see… Economic growth started slowing down in the second half, above all due to a drop in export demand,” he said.

Putin has highlighted three major directions vital for the country’s economic stimulation in the meet yesterday.

He stressed that budget spending and changing the budget rules is not an option.

“It is clear that budget measures alone are not enough to resolve the tasks before us, and if we change the budget rules we would have some risks to face,” said the president.

Russia has recently introduced fiscal rules that tie spending plans not to projected oil prices, but to long-term average oil prices.

Putin has said that lack of Russian infrastructure development is hindering economic growth, especially in transport and energy sectors.

“There is often not enough long money for infrastructure development projects. I gave the instruction at one point to examine the possibility of long-term investments using funds from the National Welfare Fund,” he said.

Thirdly, he urged the government to look closely at the regions’ ability to meet their spending commitments, as their budget revenue will be less than planned.

“I expect to hear your proposals on this issue, your ideas on how we can meet the spending commitments – and I make it clear that these commitments remain in force and no one is going to annul them – without undermining the regions’ economic and financial situation,” Putin urged.

Russia’s economic development ministry has cut the country’s 2013 GDP growth forecast from 3.6 per cent to 2.4 per cent.

“Let me bring to your attention that a growth rate of 2.4 per cent is lower than the global economy’s growth rate. It’s been a long time since we were last in this situation,” Putin commented on Russia’s slowdown.

57 founding members, many of them prominent US allies, will sign into creation the China-led Asian Infrastructure Investment Bank on Monday, the first major global financial instrument independent from the Bretton Woods system.

Representatives of the countries will meet in Beijing on Monday to sign an agreement of the bank, the Chinese Foreign Ministry said on Thursday. All the five BRICS countries are also joining the new infrastructure investment bank.

The agreement on the $100 billion AIIB will then have to be ratified by the parliaments of the founding members, Chinese Foreign Ministry spokesman Lu Kang said at a daily press briefing in Beijing.

The AIIB is also the first major multilateral development bank in a generation that provides an avenue for China to strengthen its presence in the world’s fastest-growing region.